Anyone considering opening a spa will need to decide whether to join a spa franchise or go alone as an independent spa buisness. Franchising is a huge part of the industry and can be a great way to start your spa business.
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- Advantages and Disadvantages of Spa Franchising
- How Much Does it Cost to Franchise a Spa?
- 10 Best Spa Franchise Opportunities
Advantages and Disadvantages of Spa Franchising
If you want to know if joining a spa franchise is right for you, the first step is to look at the risks and benefits faced by spa franchise owners.
Let's start with the basics. So, what is a spa franchise opportunity?
Essentially, a franchised spa is a business model that occurs when someone (the franchisor) establishes a trademark for their spa business and operating system and then charges others a franchise fee for the privilege of using that business name and system.
Franchise chains often provide other support to their spa owners as well. Some of the largest spa chains offer licensed therapists and management training and specialized resources to help each franchisor succeed.
Advantages of Joining a Spa Franchise
Brand Recognition. New spas often need to build their brand awareness and customer base from scratch, but franchising is a shortcut that can rely on the support of an existing and trusted name to help boost your marketing.
Existing Customer Base. As part of a franchise chain, a spa can rely on a name familiar to customers almost anywhere, which can reduce initial advertising costs, get customers in the door for their first service appointment, and help your location see higher profits and better growth than an independent spa when it first opens.
Business Support. Franchisees can often rely on professional development opportunities for management and staff, as well as a business network willing to provide advice and free assistance to help them set up and run their spa, sometimes even including equipment, training materials, business plans and supplies as part of your fee.
Buying in Bulk. One advantage that businesses in franchising enjoy is that they are not individually supplementing their back-of-house bar or retail products, and they typically pay lower prices for products because the entire franchise network in their area or several locations will buy in bulk, reducing the total number of fees that suppliers charge individual businesses when ordering items.
Suppose you've always dreamed Less Experience Requiredof owning your own spa business but need help figuring out how to go about it. In that case, franchising can be a great way to get into the beauty industry - spa franchisees can be part of a successful chain of spas and get a lot of help with basic aspects of advertising, recruiting and managing their spa.
Less Risky. Spa chains have tested their business models in multiple locations and have perfected their approach to success in the industry, which can make them a safer investment.
Favorable Failure Rates. Spa franchises have a lower risk of failure than independent wellness businesses, with one study showing a success rate of at least 8% higher; partnering with a well-known full-service spa chain franchise is a great marketing tool that can help you get the most out of your initial investment.
Freedom. Franchising allows you to be your own boss instead of being completely on your own; spas and their owners are part of a larger support network and have access to many different resources that independent locations do not.
It Can be Very Lucrative. One of the benefits of joining a franchise is that you already have a space in the spa service industry, customers are familiar with your services and products, and franchisees can benefit from that visibility and the customers you bring in.
Disadvantages of Franchising a Spa
Of course, even the best haircutting franchise opportunities have some disadvantages compared to owning your own spa.
Initial Costs. Popular spa chains, even smaller franchises, often require an initial investment (or franchise fee) to join the company, and their costs can vary between franchise opportunities and locations.
Rules and Regulations. Even the best spa chains still require you to abide by their rules and professional standards, including things like hours of operation, advertising requirements, and even the holidays you work (depending on your franchise agreement).
Creative Restrictions. Spas that join franchises don't always have artistic control over their layout, website, décor, or even the music they allow to be played, which can be challenging to deal with.
Ongoing Costs. Depending on your franchise agreement, you may be required to pay ongoing fees, such as royalties, company training fees, or other ongoing business expenses.
Conflicts can Occur. Spa chains rarely operate in a vacuum, and if you have to deal with a manager or co-worker you don't like, you may not have any choice but to deal with them.
Not Your Brand. Franchises are great, but they don't allow you to build your business under your brand, which can make it hard to break away from doing this later if you want to build your day spa brand for instance.
Do not miss our post on spa expenses.
How Much Does it Cost to Franchise a Spa?
So, what is the average price of a spa franchise?
Spa franchises vary greatly in the services they offer, the image they present in the health and wellness industry, and in the franchise fees they charge.
It's also important to note that the amount you pay may likewise be related to the benefits and services offered by the franchise company in exchange for your investment.
Let's take a look at some average franchising offers and what they cover.
This is the initial investment the franchisee makes in order to join. Most spas have franchise fees that range from $20,000 to $50,000.
In return, you are able to use the company's brand name, their business systems, training materials, staff uniforms and anything else they offer (such as a website) to build and market your spa.
The products you'll need to open a new spa. Typically, you will need to purchase hair franchise products and stock, sell and use a specific product line depending on your company. These costs can vary greatly, but spending $5,000 to $10,000 is normal.
A royalty fee is an annual fee you pay to the spa franchise company for the continued use of their services and company name. Royalties can be a fixed amount or a percentage of your total revenue.
Training And Setup
This includes everything from upgrading your signage and furniture, to decorating, staff and management training, and even in some cases, website templates and IT services. Including rent, this can cost $100,000 to $300,000.
So what is the cost of franchising a spa? This can depend a lot on the franchise company, whether your location is rented or owned, and the value of the services they provide.
Of course, you can save time and money by managing your franchise well and keeping an eye on your expenses. Investing in a franchise's spa software will help you stay organized, track and book appointments, and make the most of your employees' time.
10 Best Spa Franchise Opportunities
There are so many different options (both mainstream and niche) to choose from for franchisees. Here's a list of some of the best franchises we've found.
Founded in 2005 in Colorado, Spavia has been offering franchise opportunities since 2007. This company provides a variety of spa services using organic products and prioritizes eco-friendly practices such as energy saving.
The initial investment to join is $353,251 - $700,820 and franchise fees are $49,500. They take 6% in royalties.
This spa franchise has a lower barrier to entry than some of the others, with franchise fees set at $39,950 and an initial investment of $104,300 - $248,900.
Planet Beach Day Spa provides a variety of beauty and wellness services including (but not limited to) tanning, facials, hydration therapy and teeth whitening. They’ve been in business since 1995 and have over 148 locations.
Along with an online retail business, Woodhouse Day Spa provides massages, facials, waxing, body wraps, body scrubs,manicures, and pedicures. They were founded in 2001 and currently have 62 franchise units open.
Spa professionals looking to join Woodhouse should be prepared to pay an initial fee of $48,00 plus $808,250 - $985,000 in additional expenses.
This business combines spa and massage services in one location. Boasting over $1.2 million in average annual revenue and over 500 locations across North America, this is a growing franchise.
To join, you’ll need to have $480,470 on hand for initial expenses and pay a franchise fee of $39,400.
Marketing themselves as a “Fast Casual” spa, many of the treatments they offer can be done in 15 minutes or less.
Your initial investment can be anywhere from just over $80,000 to over $230,00, depending on the options you choose, but you’ll also need to include $15,000 - $50,000 in available capital. This investment includes the initial franchise fee of $25,000.
This chain specializes in skincare services and also provides resources like training, classes and specialty skincare products. They’ve been in business for over 40 years and have a strong social media presence.
To join, you’ll need an initial investment of between $321,500 - $410,000 including a franchise fee of $75,000 and at least $50,000 in ready capital.
This is a unique franchising opportunity for spa professionals who like working with children and young people. They provide makeover packages, hairstyling and child-friendly spa services.
The barrier to entry is relatively low, requiring a net worth of at least $350,000 and an initial investment of $75,000.
This spa franchise focuses on therapeutic and wellness beauty treatments in an upscale atmosphere. Started in 2012, they now have multiple locations throughout the United States.
In order to join Sole’renity Spa, you’ll need to have a minimum of $150,000 plus a franchise fee of $35,000.
This franchise is available to spa professionals in both the United States and Canada, so it’s a great option for anyone looking to set up shop throughout North America. They’re looking to expand and grow their reach.
To join, they recommend that you have at least $100,000 available plus enough credit to get a loan if needed.
This spa chain prides themselves on their customer service. They provide clients with skincare, body wraps, waxing, scrubs and massage services. Some locations even include a yoga studio.
Their franchise fees are $35,000 and you’ll want to have at least $125,000 ready to invest- although this number can easily go higher, depending on your location.
Franchising is a great way to get into the spa industry because you will be given a lot of materials and training.
With that said, there are many responsibilities and some drawbacks and it is not for everyone.
Before deciding whether to join a spa franchise, look at what opportunities are available and draw up a budget and a "wish list" of what you might want to join. Check each company's website for "fine print" and more details.
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